The IRS allows taxpayers to take tax deductions for charitable donations to qualified organizations. The Society for the Prevention of Cruelty to Animals is an international organization with no affiliation to local SPCAs. Whether or not taxpayers may deduct donations to the SPCA depends upon whether the local chapter has certified the local chapter as a qualified organization. Taxpayers may search the IRS’ comprehensive list of qualified SPCA programs to determine deductibility.
General Tax Rule for Qualified Organizations
Only organizations that have applied for recognitions as a government-qualified charity are qualified charities. The IRS provides an exception for qualification to churches and local governments. These organizations receive automatic charitable organization status. Charities, such as the SPCA, organized to serve a general charitable purpose may receive status if the organizers apply for recognition through the IRS.
The IRS allows taxpayers to deduct the actual amount of the monetary charitable donation. For property donations, the IRS allows taxpayers to deduct the property’s fair market value and the long-term capital gain value for property subsequently sold. Typically, the property’s fair market value is the amount the taxpayer originally paid for the property. The government provides worksheets with taxpayer donation examples and formulaic calculations to determine donation value for various types of property donations.
Carryover and Donation Limit for Schedule A of IRS Form 1040
The IRS limits deductions for charitable donations. The tax deduction amount depends upon the taxpayer’s filing status and gross income. Taxpayers who take standard deductions do not typically qualify for charitable donation deductions. These deductions benefit taxpayers who itemize their taxes on their tax returns. Taxpayers use Schedule A to deduct the charitable contribution in the year the taxpayer donates the cash or property. If the taxpayer cannot deduct the entire allowable donation deduction amount in the same year of donation because the taxpayer exceeds the government’s allowable limits, then the IRS allows taxpayers to use tax carryover rules to exhaust the entire value of the charitable donation in future years. The carryover provisions allow annual deduction for taxpayers to deduct up to 50 percent of the taxpayer’s adjusted gross income for five years. The IRS provides an additional ten-year deduction allowance for carryover deductions for donations to qualified conservation donations.
Receipt of Payments and Donations
Taxpayers must properly document deductions over $250. The documentation should include the amount of the donation and the date of donation. The tax rules require monetary contributions be properly documented with receipt of payment, credit card or bank statements and, if possible, the canceled check. Taxpayers who make direct payroll deduction contributions should retain pledge cards or other receipts as tax documentation.
Seek Tax Advice
Since tax laws may frequently change, you should not use this information as a substitute for legal or tax advice. Seek advice through a certified accountant or tax attorney licensed to practice law in your jurisdiction.